Convert On-demand Instance into Reserved Instance

If you need the EC2 instance usage for the long term and you will be going to utilize/run EC2 instance 24x7x365 then it is recommended, you can convert your normal on-demand EC2 instance into the reserved instance to reduce your hourly charges of an EC2 instance.

Before explaining the steps ie how we can convert the on-demand instance into the reserved instance, here we are going to present one example of comparison for t3a.micro instance once it will be used as on-demand ec2 instance and once we will use it as a reserved instance.

InstanceOn-demand hourly chargeReserved hourly charge(3yr term with no-upfront)On-demand monthly chargeReserved monthly charge
t3a.micro0.0094 USD0.005 USD6.77 USD3.6 USD
Reference :

Above we can see, if we will be using the EC2 instance as a reserved instance with a 3-year term and no-upfront payment then we can save ~47% amount compare to the on-demand EC2 instance.

Steps to convert the on-demand instance into reserved instance

— Here We have already below t3a.micro EC2 instance is running.

— Go into “EC2 Dashboard” –> “INSTANCES” –> “Reserved Instances”.

— Click over “Purchase Reserved Instances”

— Select your details like for us here.. then click over search.

  • Platform: Linux/Unix
  • Tenancy: Default
  • Offering Class: Convertible
  • Instance Type : t3a.micro
  • Term : 12 months – 36 months
  • Payment option: No Upfront

— Enter your number of quantity then click over the “Add to cart”

— Once you will click over the “View Cart”, Make sure to review your shopping cart carefully and then click over “order”.

— Go back under the “Reserved Instances” and you will notice that your reserved instance state is showing as “payment-pending”.

Here no need to worry as we have chosen the “No Upfront” payment. AWS just here verify that you have configured your payment details under “My Billing Dashboard” –> “Preferences” –> “Payment methods”. If it is already configured then after a couple of minutes we will notice that the reserved instance state is now active.

How to verify that now reserved instance is being used instead of on-demand instance pricing?

Note : We recommend to check below steps after 24 hr of activation of reserved instances.

— Go under the “My Billing Dashboard” home page and then click over the “Bill Details”.

— Under “Elastic Cloud Compute” –> “Your EC2 Region”, you will notice one section is enabled with the name “Amazon Elastic Compute Cloud running Linux/UNIX Reserved Instances”.

Above you will notice that on-demand EC2 instance hourly charges have been stopped and Reserved instance charges have been booked in advance for the remaining days (in hours).

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